Aotearoa New Zealand’s health system is being transformed. The Pae Ora (Healthy Futures) Act, which took effect on 1 July 2022, abolished 20 district health boards (DHBs) and created two new central bodies: Te Aka Whai Ora, the Māori Health Authority, and Te Whatu Ora, Health New Zealand. According to the government, the reforms aim to “create a more equitable, accessible, cohesive and people-centred system that will improve the health and wellbeing of all New Zealanders.”

Two of the country’s top health systems experts, Tim Tenbensel and Jaime King of Waipapa Taumata Rau, University of Auckland, say the government is broadly moving in the right direction.

“There’s definitely a sense that the previous DHB system was on its last legs,” says Tenbensel, an associate professor of health systems in the School of Population Health. “Unlike health reforms in previous decades, these have in principle quite a bit of support from the health sector.”

However, the details of implementation are what will determine the reforms’ success – or lack thereof, the experts say.

“Overall, I like the direction the reform is taking,” says King, who is John and Marylyn Mayo Chair in Health Law. “However, anytime you’re trying to drive massive change in a large and existing system, there are people who wholeheartedly take on that change and then there are people who are much more resistant.”

The case for health reform
The current health reform isn’t the first Tenbensel has seen in his 25 years of teaching and researching health policy. At the turn of the millennium, Helen Clark’s Labour government went the opposite direction – it decentralised the health system to provide more local input and control over services. This was a response to the 1990s abolition of local boards under a National government.

In practice, the DHB system grew fragmented and complicated. The biggest problem, however, was and is inequity.

Compared to other high-income countries, New Zealand’s healthcare system is overall in the middle, sixth out of 11 in a recent Commonwealth Fund analysis. It does well in spending efficiency and in areas such as coordinated care and safe care. However, Māori life expectancy at birth is seven years shorter than non- Māori. New Zealand ranks third-last in equity.

Health inequities aren’t a consequence of the decentralised DHB system but rather of systemic settings such as how primary care is financed, says Tenbensel.

“Compared to many other high-income countries, people on lower incomes here have much greater problems accessing primary health care, mostly because of the co-payment to see the GP but also because of the cost of transport and lack of availability in rural areas.”

Another major problem has been the poor integration of community-based healthcare providers, such as mental health organisations and hauora Māori and Pacific health providers, says Tenbensel.

“Life for these organisations over the last 10 or 20 years has been unbelievably challenging. Their funding hasn’t increased, they have to spend an enormous amount of their time competing for contracts with each other, there are huge compliance costs and their funding is usually 12-month contracts.”

The creation of the Māori Health Authority could go a long way towards addressing some of the inequities in the system – but only if it’s strongly resourced and allowed time to build trust and relationships, says King.

“Having two entities, which have parity and are accountable to each other, the Crown and the populations they serve, will be very powerful if implemented correctly, which is always the caveat.”

King is cautiously optimistic about the creation of Iwi Māori Partnership Boards and localities, which will represent their communities to the central bodies.

“I was initially concerned about local areas losing their voice if you centralise everything, but it does look like there are initiatives to make sure healthcare is responsive to community needs,” says King. “Still, getting the balance right between central authority and local representation won’t be easy.”

King also likes that the legislation takes a broader view of public health and social determinants of health. It establishes a public health agency under the Ministry of Health to work on overarching strategy and requires the Ministry of Health, Te Whatu Ora and Te Aka Whai Ora to collaborate with other agencies on a population health approach.

“So much of what’s causing our healthcare issues and inequities isn’t going to be solved by fixing what’s happening in our hospitals,” says King. “Addressing broader social determinants of health through things like the Healthy Homes Initiative and Smokefree Aotearoa 2025 will be really useful.”

Both Tenbensel and King say the early stages of implementing the health reforms seem to be going well. However, they see stumbling blocks ahead.

One potential strength could also be a weakness: that the new health organisations are required to consult and collaborate with many different groups.

“Each one in themselves is justified, but there are capacity issues and the potential for very different messages and demands to come from different groups,” says Tenbensel. “I don’t think there’s an awareness of the capacity and skill base that’s needed to work in that sort of collaborative way. In many parts of the country, there have been quite tense and distrustful relationships between different organisations in the health sector. That history doesn’t change overnight.”

The deep-rooted mistrust many Māori and Pacific people have towards the health system also won’t be easy to change, says Tenbensel.

“There’s a history of 180 years of interactions with the health service that often haven’t gone well for Māori. A similar history exists for Pacific people.”

One goal of the reforms is to train more Māori and Pacific healthcare providers, as well as to train existing workers to better engage with people from these cultures. This is easier said than done.

Raising numbers of healthcare providers, as well as upskilling and better supporting existing ones, is critical because the pandemic has resulted in severe staff shortages due to burnout and low immigration, the experts say.

“When there are shortages, you get a vicious cycle: people get burnt out, they leave the heath workforce, and that creates more shortages,” says Tenbensel. “Most of this is not subject to any quick fix.”

Resourcing will also be a challenge going forward because years of stagnant funding have led to low health sector wages and urgent infrastructure needs. While the health reform has enacted significant budget increases, much of it will be absorbed by health sector pay rises.

“Many would argue that this is right,” says Tenbensel. “However, quite a bit else needs to be done. We have high levels of unmet health need. A good example is the late diagnosis of cancer, which has to do with poor access to primary care. Half of diagnoses of lung cancer happen in the ED. That’s extraordinary.”

The experts see more challenges in the future – and while the government recognises some of these, it remains to be seen how much the health reforms will address them. One of these challenges has to do with the rising rate of non-communicable diseases related to lifestyle factors such as obesity and smoking. Another has to do with climate change.

“We’re seeing more droughts, heat and floods, all of which affect health,” says King. “The mental health effects of climate change are also profound, especially for people affected by climate-based migration, and it’s quite likely that a lot of the pandemics and diseases we’re seeing are coming from loss of animal habitat.”

King says her top piece of advice to government would be to focus funding on disease prevention and determinants of health such as housing and transportation.

“As they say, an ounce of prevention is worth a pound of cure. If you address those social and environmental determinants of health further upstream, you don’t end up with the same inequities and vulnerabilities in times of crisis.”

It’s unlikely that the current health reform will achieve all its aims, says Tenbensel, who co-edited a book on health reforms in 12 countries around the world.